I don't think Grain Belt Express got a lot of love during its Valentine's Day oral argument at the Illinois Fifth District Court of Appeals. You can (and should!) listen to the Oral Argument for yourself. It's less than 40 minutes and I liked it so much I listened to it twice. I wanted to think about and enjoy what I was hearing. The Court has posted audio of the argument here. Page down to find the case called "Concerned Citizens and Property Owners vs. Illinois Commerce Commission and then click on the speaker icon on the right side of the page.
Trying to predict how a Court may rule based on Oral Argument is a tricky business. The judges are rarely obvious about how they feel, but if you listen to their questions you may pick up some clues. It's not so much who gets more questions, but the nature of the questions and what they reveal about what the judges want to know to help them decide the case.
I do want to say that all the lawyers were well prepared and on top of their game. At the end, one of the judges tells them so, and that their briefs were all very well done. However, he didn't stop there. He called out the brief of appellant attorney Paul Neilan (for Zotos) as particularly well done and informative. Afterwards, I simply had to read that one for myself and I agree that he did a top notch job explaining things as briefly as possible. That's often the key... appeals rely heavily on the briefs submitted by the parties to the case. Judges are not experts on every topic, especially ones as complicated as electric transmission. Giving them the information they need to decide the case, without adding a bunch of information that is not useful, is the goal. Transmission is so complicated and layered it's a monumental task indeed. Neilan is master of the brief! And several of the questions the judges asked seemed to come right out of his brief. He set the knowledge base and that's a very good place to be at Oral Argument.
The case for the appellants was argued by Chuck Davis from Illinois Farm Bureau and Brian Kalb for the landowners. The arguments centered on the constitutionality of GBE's special purpose legislation to enable GBE and compel the ICC to approve it (and only it) by usurping the ICC's normal process. I especially liked Davis's opening statement that Grain Belt Express 2.0 is back after its sale to a new owner that changed Illinois law in an attempt to permit a project that was not successful under its last owner. The Courts determined that it and sister project Rock Island Clean Line were not a public use. Grain Belt's "build it and they will come" plan is a cloud on landowner titles and a quest for eminent domain. GBE would not subject itself to state permitting if it was not seeking eminent domain authority. The ICC's argument is that GBE is not seeking eminent domain, but that fails because GBE made it clear that it is seeking eminent domain in the letters it sent to landowners. The new law provides an automatic grant of public use only to GBE and is therefore special purpose legislation for benefit of only one company.
Questions the judges asked:
1. Is the windfarm in Kansas already built?
2. If GBE has been sold to Invenergy, has RICL also been sold to them?
3. Don't the letters to landowners threaten eminent domain?
4. If the windmills produce alternating current, what's the reason for a transmission line to turn it into direct current, if it could have been transmitted as alternating current?
These questions don't appear to me to be hostile to the landowners. In fact, they may actually be hostile to GBE.
Landowner attorney Brian Kalb told the Court that the enabling legislation is unconstitutional special legislation that discriminates in favor of a select group (GBE) without a reasonable basis of equal protection and is arbitrary. The legislation is bespoke legislation only for Grain Belt Express and the legislative transcripts indicate as much. The legislation requires the ICC to find it in the public interest if it delivers energy to MISO or PJM. That is not a determination of public interest. (Bravo! That's exactly right!). There is no showing that GBE benefits the citizens of Illinois.
Questions the judges asked:
1. Didn't the ICC have to make a finding that there was benefit to the citizens of Illinois?
Kalb answered that under the statute that benefit is deemed by fiat and the Commission's role has been usurped as long as GBE connects to MISO or PJM.
The Judge asked if the connection points aren't governed by FERC?
2. At what point does GBE cross the river?
Again... questions not hostile to landowners position.
Next, Brian Dodds argued the ICC's position that the legislation is constitutional. He says the landowners challenges fail because they have not shown that some other transmission company has been denied a permit to do something other than what GBE is doing enabled by its special legislation. He says there is a converter station in Ralls County, Missouri (except there is not... interconnection has been changed to Callaway County and a new 40-mile spur to enable it has been added to GBE... if the ICC attorney doesn't even know where it connects, how accurate is the rest of his information?).
Judge questions:
1. If the goal of the legislature is 100% clean energy, why limit the legislation to just 9 counties, and why have a time limit on applicable projects? (this was actually never answered in the gush of responding words).
2. The ICC Order says the transmission project must be fully funded before construction starts. How can the ICC defer that finding?
3. Explain the financial benefit for the citizens of Illinois from this project.
4. Doesn't the benefit rely mainly on price drop and credits and things up in the wind that nobody knows if they will take place in the future or not?
These questions don't seem particularly friendly to GBE. In fact, they may be hostile questions.
Last attorney was David Streicker for GBE. He told the Court that even though the legislation requires a finding of public benefit, GBE submitted evidence that it did anyhow.
Judge questions:
1. How was it determined that GBE lowers costs for Illinois consumers?
2. Does expert testimony say that our national security is dependent upon a wind farm?
I'm going to leave this up to the reader to decide whether there were hostile questions for GBE. I think you are probably getting the hang of it by now.
The landowners were allowed to present a brief rebuttal at the end that begins with Brian Kalb. He said that the ICC and GBE had failed to support their argument that the legislation was simply for clean energy because they didn't explain how the 9 specific counties and the deadline promoted clean energy in general, not just GBE. It's an opportunity for GBE, but a wall for any other utility. The ICC makes a finding of the best route for a transmission project, not the legislature. He is followed by Chuck Davis who makes the point that ICC has set itself up to make a finding of GBE's financial capability all by itself without input of the parties, which is an ex parte no-no. ICC is required to make its findings with the knowledge and participation of all the parties. Its Order must be overturned until it does this. It cannot reserve some determinations to be made without participation at a later date. He also points out that an ICC certificate is only good for 2 years, but the ICC has given GBE 5 years to to begin its project.
I am greatly encouraged after listening to the Oral Argument. You should be, too. The attorneys for Farm Bureau and the landowners did what they needed to do. They answered all questions posed and made great arguments. Say a prayer, cross your fingers, hold your breath... and never stop hoping that justice will prevail.
Trying to predict how a Court may rule based on Oral Argument is a tricky business. The judges are rarely obvious about how they feel, but if you listen to their questions you may pick up some clues. It's not so much who gets more questions, but the nature of the questions and what they reveal about what the judges want to know to help them decide the case.
I do want to say that all the lawyers were well prepared and on top of their game. At the end, one of the judges tells them so, and that their briefs were all very well done. However, he didn't stop there. He called out the brief of appellant attorney Paul Neilan (for Zotos) as particularly well done and informative. Afterwards, I simply had to read that one for myself and I agree that he did a top notch job explaining things as briefly as possible. That's often the key... appeals rely heavily on the briefs submitted by the parties to the case. Judges are not experts on every topic, especially ones as complicated as electric transmission. Giving them the information they need to decide the case, without adding a bunch of information that is not useful, is the goal. Transmission is so complicated and layered it's a monumental task indeed. Neilan is master of the brief! And several of the questions the judges asked seemed to come right out of his brief. He set the knowledge base and that's a very good place to be at Oral Argument.
The case for the appellants was argued by Chuck Davis from Illinois Farm Bureau and Brian Kalb for the landowners. The arguments centered on the constitutionality of GBE's special purpose legislation to enable GBE and compel the ICC to approve it (and only it) by usurping the ICC's normal process. I especially liked Davis's opening statement that Grain Belt Express 2.0 is back after its sale to a new owner that changed Illinois law in an attempt to permit a project that was not successful under its last owner. The Courts determined that it and sister project Rock Island Clean Line were not a public use. Grain Belt's "build it and they will come" plan is a cloud on landowner titles and a quest for eminent domain. GBE would not subject itself to state permitting if it was not seeking eminent domain authority. The ICC's argument is that GBE is not seeking eminent domain, but that fails because GBE made it clear that it is seeking eminent domain in the letters it sent to landowners. The new law provides an automatic grant of public use only to GBE and is therefore special purpose legislation for benefit of only one company.
Questions the judges asked:
1. Is the windfarm in Kansas already built?
2. If GBE has been sold to Invenergy, has RICL also been sold to them?
3. Don't the letters to landowners threaten eminent domain?
4. If the windmills produce alternating current, what's the reason for a transmission line to turn it into direct current, if it could have been transmitted as alternating current?
These questions don't appear to me to be hostile to the landowners. In fact, they may actually be hostile to GBE.
Landowner attorney Brian Kalb told the Court that the enabling legislation is unconstitutional special legislation that discriminates in favor of a select group (GBE) without a reasonable basis of equal protection and is arbitrary. The legislation is bespoke legislation only for Grain Belt Express and the legislative transcripts indicate as much. The legislation requires the ICC to find it in the public interest if it delivers energy to MISO or PJM. That is not a determination of public interest. (Bravo! That's exactly right!). There is no showing that GBE benefits the citizens of Illinois.
Questions the judges asked:
1. Didn't the ICC have to make a finding that there was benefit to the citizens of Illinois?
Kalb answered that under the statute that benefit is deemed by fiat and the Commission's role has been usurped as long as GBE connects to MISO or PJM.
The Judge asked if the connection points aren't governed by FERC?
2. At what point does GBE cross the river?
Again... questions not hostile to landowners position.
Next, Brian Dodds argued the ICC's position that the legislation is constitutional. He says the landowners challenges fail because they have not shown that some other transmission company has been denied a permit to do something other than what GBE is doing enabled by its special legislation. He says there is a converter station in Ralls County, Missouri (except there is not... interconnection has been changed to Callaway County and a new 40-mile spur to enable it has been added to GBE... if the ICC attorney doesn't even know where it connects, how accurate is the rest of his information?).
Judge questions:
1. If the goal of the legislature is 100% clean energy, why limit the legislation to just 9 counties, and why have a time limit on applicable projects? (this was actually never answered in the gush of responding words).
2. The ICC Order says the transmission project must be fully funded before construction starts. How can the ICC defer that finding?
3. Explain the financial benefit for the citizens of Illinois from this project.
4. Doesn't the benefit rely mainly on price drop and credits and things up in the wind that nobody knows if they will take place in the future or not?
These questions don't seem particularly friendly to GBE. In fact, they may be hostile questions.
Last attorney was David Streicker for GBE. He told the Court that even though the legislation requires a finding of public benefit, GBE submitted evidence that it did anyhow.
Judge questions:
1. How was it determined that GBE lowers costs for Illinois consumers?
2. Does expert testimony say that our national security is dependent upon a wind farm?
I'm going to leave this up to the reader to decide whether there were hostile questions for GBE. I think you are probably getting the hang of it by now.
The landowners were allowed to present a brief rebuttal at the end that begins with Brian Kalb. He said that the ICC and GBE had failed to support their argument that the legislation was simply for clean energy because they didn't explain how the 9 specific counties and the deadline promoted clean energy in general, not just GBE. It's an opportunity for GBE, but a wall for any other utility. The ICC makes a finding of the best route for a transmission project, not the legislature. He is followed by Chuck Davis who makes the point that ICC has set itself up to make a finding of GBE's financial capability all by itself without input of the parties, which is an ex parte no-no. ICC is required to make its findings with the knowledge and participation of all the parties. Its Order must be overturned until it does this. It cannot reserve some determinations to be made without participation at a later date. He also points out that an ICC certificate is only good for 2 years, but the ICC has given GBE 5 years to to begin its project.
I am greatly encouraged after listening to the Oral Argument. You should be, too. The attorneys for Farm Bureau and the landowners did what they needed to do. They answered all questions posed and made great arguments. Say a prayer, cross your fingers, hold your breath... and never stop hoping that justice will prevail.
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